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April 18, 2001
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Money > Business Headlines > Report April 18, 2001 |
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Rupee slide in sync with falling duties, QR exit: MontekKausik Datta Planning Commission member Montek Singh Ahluwalia on Tuesday said the rupee's slide against the dollar would continue as depreciation of the currency was directly related to reduction in duty rates and lifting of quantitative restrictions. Ahluwalia's observation comes the day after the rupee plunged to its historic low of Rs 47.05 against the dollar yesterday. The rupee closed the day today at Rs 46.89 to the dollar. Ahluwalia, who is also member of economic advisory council to the prime minister, said: "Depreciation of the rupee is linked to lower duty rates. As the country aims to move towards to a rationalised duty structure, the rupee would slide against the greenback". On the positive side, Ahluwalia, who was speaking at the sidelines of a seminar organised in Calcutta on Tuesday at the Indian School of Social Welfare & Business Management, said the depreciation would help exports become more competitive against goods from south east Asian countries. He said: "The abolition of QRs on items and the finance minister's proposal to lower duty rates are required to achieve the desired 8 per cent growth in gross domestic product. Without attaining the required GDP growth rate, India would not be able to compete with south east Asian countries." According to him, dumping of foreign goods following reduction in duty rates would be partially checked by the fall in exchange rates. The finance minister would announce further reduction in duty rates in Parliament shortly to rationalise the rates, as they continue to be among the highest in the region. He, however declined to comment on what should be the "ideal" exchange rate. "That is a factor which would be determined by markets," he said. Ahluwalia said following the opening up process, which was kicked off a decade ago, industries would have to be globally competitive. Powered by YOU MAY ALSO WANT TO READ:
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